Tax Rules: Final: 5703-25

5703-25-11 Valuation of land

(A) General - All land shall be appraised at its true value
in money as of tax lien date of the year in which the
appraisal or update of values is made. In arriving at the
true value in money the county auditor shall consider, along
with other factors, not only the present use of the land but
also its highest and best probable legal use consistent with
existing zoning and building regulations. The requirement
that land be classified under rule 5703-25-10 of the
Administrative Code according to its principal use shall not
affect the requirement of this rule that it be appraised at
its highest and best probable legal use. The present
improvements to the land, the demand and supply of land, the
demand and supply of land for such use, financing method, the
length of time until developed and the cost of development
are factors that should be considered in determining the
highest and best probable legal use of the land.

(1) The preferred method is the market data or comparative
process requiring the collection and analysis of actual
arms-length sales and other market information on comparable
sites made within a reasonable time of the date of the
appraisal with adjustments for variations. This method should
be used except in unusual circumstances.

(2) The allocation method in which the land value is
estimated by subtracting the value of the improvements from a
known sale price. This is primarily used in an area where
there are very few sales of vacant land and the improvements
to land are of a generally uniform type.

(3) The land residual method estimates land value by
capitalizing the residual income imputable to land as derived
from actual or hypothetical new improvements assuming highest
and best use. This method is useful in arriving at land value
when there are few or no sales or as a check against the
market approach.

(4) The development method can be used in valuing land ready
for development by estimating value as fully developed and
subtracting the development, administrative and
entrepreneurial costs.

(D) The county auditor shall deduct from the value of each
separate parcel of real property the amount of land occupied
and used by a canal or used as public highway as provided in
section 5713.04 of the Revised Code.

(E) Agricultural - Agricultural lands shall be classified and
valued according to their characteristics and capabilities
for use, based primarily on what they will produce under
average conditions and typical management in the locality.
Assessors should obtain and use information available
relating to soil classification, land capabilities, land use
and soil maps, production records, price records and other
information from the Ohio state university, Ohio agricultural
research and development center, county A.S.C., soil
conservation service, soil and water conservation districts
and other sources. All agricultural lands shall first be
valued according to their true value. Then if the owner
applies to have the land valued according to its current
value the land has for agricultural use the land may be
valued according to rules 5703-25-30 to 5703-25-36 of the
Administrative Code

(F) Industrial - Additional factors that shall be considered
in valuing industrial land are the convenience of location to
shipping and labor sources as well as the proximity to
related industries. Land not used in manufacturing shall be
valued according to its value for use as parking lots,
storage, waste or dump area, or other uses both present and
probable.

(G) Commercial - In the valuation of commercial sites the
location in the trading area, the purchasing power of the
entire area, and the relative availability of sites shall be
considered in addition to previously mentioned factors.

(H) Residential - Residential sites located in suburban and
rural areas shall be valued by using the same factors that
are used in valuing urban residential lands with the same
facilities and amenities.

(I) Coal, mineral deposits, oil and gas - Coal and minerals
shall be valued in the same manner and on the same price
level as other real property. Some of the factors that shall
be considered in valuing coal and mineral deposits are the
quality and extent of the deposit, the active working area
which at current production will be mined within five years,
active reserves that will not be worked for five to ten
years, inactive reserves that will not be worked until after
ten years, and mined out or depleted areas.

Separate oil and gas rights shall be valued in accordance
with the annual entry of the tax commissioner in the matter
of adopting a uniform formula in regard to the valuation of
oil and gas deposits in the eighty-eight counties of the
state.

When rights to coal, minerals, oil and gas have not been
separated from the fee, the value of the mineral deposits
shall be added to the value of the surface.

(J) Pricing units and preparation of land unit price
schedules, and depth tables. Land unit prices (price per
acre, square foot or front foot) used shall be those
appropriate and typically used in the market in pricing
similar land. Generally per acre prices shall be used in
pricing agricultural lands. Large industrial, commercial or
residential tracts may be priced by the use of per acre or
square foot prices. Front foot prices shall be used,
generally, for the pricing of residential and commercial lots
and lands in congested areas. Regardless of the pricing unit
used, the result shall be the true value in money of the
land.

(K) Each county auditor shall prepare, or have prepared,
under the auditor's direction and supervision:

(1) Land schedules, setting forth land unit prices to be used
in appraising the different classes of land.

(2) Tables, where applicable, showing depth, corner and alley
influence factors, etc., to be used in conjunction with the
unit prices.

(3) Tax maps that shall accurately indicate the area, acreage
or dimensions of each lot, tract, or parcel of land in the
county, together with the name of the owner, if possible, and
the lot section, or survey number, showing the unit price
used in pricing the various types of land.

One set of all land unit price schedules, depth, corner and
alley influence tables, and tax maps with unit prices shall
be kept on file in the county auditor's office, open for
public inspection during regular office hours.